Thursday, 29 June 2017

The
way in which the Tories and the DUP have cobbled together a deal to keep May in
power tells us a lot about the reality of government finances. The cost of this isn’t just the £1 billion
extra outside Barnett for Northern Ireland, it’s also the cost of abandoning
badly thought through manifesto commitments on pensions, social care, and the
winter fuel allowance. (As a former Tory
Chair put
it, had the Tories actually put before the electorate the policies which
they’ve now decided to implement, they might well have won the increased
majority which May was seeking.) The
total expenditure over and above that implied by the manifesto is probably in
excess of £20 billion. Luckily for the
Tories, they didn’t think it necessary to provide costings for their manifesto;
had they done so, it would now be obvious just how many billions adrift they
are.

That
money has to come from somewhere, of course, and some of the discussion has
talked about this being “taxpayers’ money”.
That implies that it’s coming from taxes one way or another, but that
isn’t necessarily so; it could also come from borrowing. Or the government could simply create more
money. In any event, finding a few extra
billions isn’t a problem, because there really is a magic money tree (or even two)
and the ease with which the government has agreed to find the money underlines
that fact. The obsession with reducing
the debt is, and always has been, a smokescreen with which to hide an
ideological commitment to a smaller state and an increase in wealth disparity.

The
amazing thing is that, despite demonstrating time after time that the deficit
isn’t a problem, the Tories can still make the media and other parties dance to
their tune, and demand that they say how they will reduce the debt which the
Tories are busy creating. It’s a
reflection on the quality of journalism today that they are getting away with
it.